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Decision makers and analysts often use groups of ratios to examine the different aspects of a companys performance. Indicate whether each of the following statements
Decision makers and analysts often use groups of ratios to examine the different aspects of a companys performance. Indicate whether each of the following statements regarding financial ratios are true or false?
\begin{tabular}{|l|l|l|} \hline \multicolumn{1}{|c|}{ Statement: } & True: & False: \\ \hline Acompanyexhibitingahighliquidityratiomeansitisnotlikelytohaveenoughresourcestopayoffitsshort-termobligations. & & \\ \hline Debtorfinancialleverageratioshelpanalystsdeterminewhetheracompanyhassufficientcashtorepayitsshort-termdebtobligations. & \\ \hline Acompanysshareholderisanyonewhoisaffectedbytheactionsofthatcompany,suchasemployees,membersofthelocalcommunityinwhichthebusinessoperates,ormembersofthecommunityinwhichthebusinesshasanenvironmentalimpact. & & \\ \hline Onepossibleexplanationforadecreaseinafirmsprofitabilityratiosoveracertaintimespanisthatthecompanysincomehasincreased. & \\ \hline Market-valueormarket-basedratioshelpanalystsfigureoutwhatinvestorsandthemarketsthinkaboutthefirmsgrowthprospectsorcurrentandfutureoperationalperformance. & \\ \hline Assetmanagementoractivityratiosdonotprovideusefulinsightsintomanagementsefficiencyinusingafirmsworkingcapitalandlong-termassets. & \\ \hline \end{tabular}
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